The Problem


theproblem

New Yorkers  are spending thousands of dollars to find jobs through employment agencies only to be scammed and exploited by those agencies.  Job seekers are charged illegal fees, defrauded by unlicensed agencies, and refused reimbursement even when an agency fails to place a worker at a job.  Job seekers are seldom told they can pay  fees in installments and so pay up-front and in full.  Too often employment agencies will claim to have located a job, but when a job seeker pursues the job, they are met with vacant locations or owners with no knowledge of a job opening.  Additionally, when a job seeker does find a job, he or she finds that the job pays below the minimum wage, is unsafe, or is exploitative in other ways. 

Employment Agency Facts

  • Fraudulent employment agencies in New York prey on vulnerable low-wage workers. They often collect fees from job seekers, fail to secure jobs, and refuse refunds.
  • Approximately 300 employment agencies are licensed by the New York City Department of Consumer Affairs (“DCA”),[1] but advocates know that hundreds more operate without a license.
  • Approximately 100 employment agencies operating outside of New York City (“NYC”) are licensed by the New York State Department of Labor.[2]
  • Employment agencies licensed by DCA are largely clustered in Queens (Roosevelt Avenue area), Midtown Manhattan, and Downtown Manhattan.[3]
  • Residents from every borough in NYC use employment agencies. Between 2010 and 2012, 79% of complaints to DCA concerning employment agencies came from Brooklyn, Queens, and Bronx residents.[4]
  • Between 191 and 289 complaints were filed with DCA each year from 2010 through 2012.[5]
  • Community advocates believe that the vast majority of individuals who encounter employment agency fraud or misconduct do not file a formal complaint with DCA. The fact that DCA receives hundreds of complaints each year tells advocates there are likely thousands of job seekers harmed by employment agencies each year.
  • New York’s employment agency laws discriminate against low-wage workers.
    Agencies can charge low-wage workers a fee before placing them in a job while other types of workers pay a fee only after placement.[6]
  • Based on a recent study of employment agencies based in Queens, New York:[7]
    • 81% of survey respondents who used an employment agency and did not find a job were still charged a fee (average of $122) by the agency.
    • One third of survey respondents were offered jobs paying below the state minimum wage.
    • Nearly one in four employment agencies visited by mystery shoppers did not have a license visibly posted, as required by law.
    • Approximately two-thirds of survey respondents were not given a contract by an employment agency, as required by law.
    • Survey respondents who did not receive a contract from an employment agency were 50% more likely to report fraud than those with a contract.

[1] Freedom of Information Law (“FOIL”) data obtained by LatinoJustice’s Employment Agency Abuse Project (“EAAP”) from DCA in March 2013

[2] New York State Department of Labor, http://labor.ny.gov/workerprotection/laborstandards/employer/EmpAgency.shtm (last visited March 31, 2014)

[3] Freedom of Information Law (“FOIL”) data obtained by LatinoJustice’s Employment Agency Abuse Project (“EAAP”) from DCA in March 2013

[4] Id
[5] Id
[6] NY CLS Gen Bus § 185 (2014)
[7] New Immigrant Community Empowerment et al., Dreams and Schemes in Queens, NY: Immigrant Struggles to Find Work and Obtain Status in the Face of Consumer Fraud. (Oct. 2012), http://www.urbanjustice.org/pdf/publications/DreamsandSchemes.pdf